Note: This blog was written prior to the recent announcement that Mavis Tire Supply Co. is acquiring 112 NTB Tire & Service Centers.

Two recent announcements have generated a great deal of speculation: Goodyear Tire & Rubber Co.’s acquisition of Raben Tire Co. and the decision by Les Schwab Tire Centers’ shareholders to put the Bend, Ore.-based dealership – the fifth largest independent tire store chain in the United States – up for sale.The Raben deal gives Goodyear nine more retail outlets and 10 additional commercial outlets in the Midwest. (Goodyear also picks up 11 combined retail/commercial locations and three retread plants as part of the transaction.)

Whatever entity that ends up buying Les Schwab will inherit nearly 500 combined commercial/retail locations throughout the northwestern U.S., including Alaska. It will acquire three Les Schwab retread plants, as well.

In addition, Les Schwab’s buyer or buyers will gain an independent brand that has been synonymous with tire sales and service in its geographic area for many decades – similar to what Raben, which is based in Indiana, brings to Goodyear.

But who – or what – will meet Les Schwab’s reported asking price of $3 billion?

The answer: It won’t be a tiremaker. I’m betting the buyer will be a private equity group.

But don’t just take my word for it. Independent tire dealerships “remain quality unique strategic assets" for private equity firms, according to John Healy, author of MTD’s monthly Marketplace column and managing director and research analyst with Cleveland, Ohio-based Northcoast Research Holdings LLC.

In my 23 years in our industry, I don’t remember ever seeing as many acquisitions as the number that we witnessed last year.

Which dealership will be next?

Count on the following: It will be a company that nobody expected, much like Raben and Les Schwab. The dealership’s eventual buyer will come from left field, too. And whether or not the Les Schwab transaction is completed by then, the next “for sale” sign will go up before the end of the year.

What's your prediction?

Author

Mike Manges
Mike Manges

Editor

Mike Manges is Modern Tire Dealer’s editor. A 20-year-plus tire industry veteran, he is a three-time International Automotive Media Association award winner and holds a Gold Award from the Association of Automotive Publication Editors. Mike has traveled the world in pursuit of stories that will help independent tire dealers move their businesses forward.

View Bio

Mike Manges is Modern Tire Dealer’s editor. A 20-year-plus tire industry veteran, he is a three-time International Automotive Media Association award winner and holds a Gold Award from the Association of Automotive Publication Editors. Mike has traveled the world in pursuit of stories that will help independent tire dealers move their businesses forward.

View Bio
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